Storing your bitcoin? Funds are safu?
Disclaimer: I do these only to learn and question my choices and what is best option for me. Everybody is different and there is no “right” or “wrong” way to store your funds, find what works for you! Bitcoin gives you freedom, but with it comes also responsibilities, so choose carefully.
I whole heartedly recommend everybody to get hardware wallet, its awesome way to learn more about security and how to be your own bank. Also consider running your own NODE to go even deeper. “Not your keys, not your coins”, it’s that simple.
If i stored my funds only for myself i would definitely do some next level mission impossible style multi-signature hardware wallet setup with for eg electrum. I am a father of two so i have to consider other options too. I want to see future where everybody is their own bank and these things are just as natural and normal like using your home keys. We are very far from this. I rage and rage about defi how it opens big opportunities for us regular joes, but 99% simply wont care, it takes time. I have given out handful of ledgers to friends and family, and it takes time to learn.
Storing funds in exchanges?
Storing your funds in exchanges is lot safer these days than it used to be. I store only small amounts in exchanges. Don’t put all your eggs in one basket, there is lot of uncertainty still. They go down when markets are highly volatile, bank run? Hacks? Kyc? Regulation? Account locked? You will learn and gain the confidence through bitcoin to free yourself.
Big shoutout to Kraken: https://www.kraken.com/proof-of-reserves
Still, you will get the confidence over time.
There is nothing wrong searching yield for your assets, but bitcoin is the last asset on the planet i wanna risk, is for eg 6% apr enough? Makes no sense. Allocate only small portions to different earn exchanges if you wanna go this route.
Hardware wallets
I personally prefer ledger, no complaints. With HW-wallet you have total control of your funds. It is very powerful. I recommend setting it up with 24 words + passphrase. This is the way. Store your 24words safely in few different locations and you get peace of mind with passphrase if your seed list is compromised. Have also backup device. This is 99% best option for everybody. This is still very hard to explain for my family who i would like to have my funds if my time comes. I can trust the seeds for people who are clueless, but my crypto friends i cannot trust these at all so, comsi, comsa.
Don’t overthink these, you will quickly go too deep and build something overcomplicated, that yourself have hard time to keep up… And how your non-tech family can get to your funds if you have hard time doing it? And what are you really trying to achieve by protecting your funds?
My family isn't there yet, they have hard time learning. They will get there, i will not pressure them. Longer they hodl and more they learn about bitcoin, they will get the confidence in the end.
Multisig — paid services
This is pretty nice service, but it comes with a cost. The cost is pretty high 120ust per year. There is competitor with fraction of the cost compared to CASA, but it requires KYC.
CASA is the bridge for now to keep your self sovereignty combined with simplicity in form of an app that even my mother in law can use it. I also like that you can test and check status of your keys. You can also easily replace the keys and build your own setup. Default is that one key is held by CASA and 2 other by you, mobile key (you can replace to HW) and hw-wallet. It is 2/3, so it is easy by mobile and confirm with hw-wallet to make transaction and if you lose your phone or hw-wallet you can use the 3 security question option (key held by casa). I would like it even more if it had 2/4 setup, but yeah nothing is perfect.
This is almost perfect solution at the moment, where my closest and dearest don’t really get hw-wallets, but are very adept with apps etc. Anybody can deal with signing with hw-wallet, but restoring seeds + passphrase, it is lot harder task.
Be safe! Keep learning! You will get the confidence ❤
Sources:
https://www.youtube.com/c/CryptoGuide
Cool channel to learn more.
